Amid so much new development in the city, it would be easy for the 42 condos proposed for the corner of 23rd and Valencia to become but a footnote in the stacks of building proposals lining the desks of planning officials.

But the proposed development is notable for another reason — it is also part of a parallel trend to transform old, polluted gas stations into residential developments, according to planning and public health officials. Real estate prices have proven so strong in recent years that it pays to clean up the empty service stations.

“Based on our observation, the number of former gas stations being developed does appear to be increasing, especially the past several years,” said Albert Lee, an inspector with the Department of Public Health. The department is responsible for overseeing the cleanup at 1198 Valencia and other polluted gas stations around the city. This must be done before residential development can proceed.

Until the 1980s, most tanks storing petroleum were made of a single layer of steel, making them incredibly susceptible to corrosion and leaks. That means there is almost always contamination of soil and groundwater at gasoline service stations, where these tanks were utilized.

In the Mission District, three former gas stations slated for residential development have been registered on the Leaking Underground Storage Tanks (LUST) database maintained by the Environmental Protection Agency. In addition to 1198 Valencia, 18 condos have been proposed for 899 Valencia and 84 units for 490 South Van Ness. All have previously been the site of a service station.

Former gas stations are attractive to developers because they are often on busy corners and have larger lots. Moreover, they are also often surrounded by residential blocks making permits for residential construction easier to get.

The cleanup process, however, is often lengthy and complex. Last year the Department of Public Health issued a cease-and-desist letter, halting work at 490 South Van Ness after toxic fumes caused local residents to complain of headaches. The odor arose during excavation of the soil, but according to the Department of Public Health, the problem has been addressed.

Though the plan to build 84 units in the seven-story development was temporarily put on hold, the soil remediation process has resumed and the $15 million project is expected to eventually move forward.

Cleaning up 1198 Valencia at 23rd Street, formerly a Chevron gas station that has been leaking oil into the soil and groundwater for decades, is also proving to be a challenge.

“Because contamination is more extensive at this site than other sites in the area, investigation and clean up of the site is taking longer,” Lee said.

The construction timeline is still uncertain because of outstanding questions about when the cleaning up of the 14,000 square feet will be finished.

JS Sullivan, the developer, filed paperwork in September to determine how the proposed project might cast shadows on neighboring buildings and parks, known as a Shadow Analysis, indicating it is still only in the very early stages of the approval process.

“Remediation work is active right now,” wrote Sean Sullivan, managing partner at JS Sullivan, in response to an inquiry into the project via email.

“Time will tell how that process goes. We plan to develop the site, but due to remediation and entitlement work, we really don’t have any expectations of being able to start anything anytime soon.”

Several developers behind the mid-Market real estate boom have been able to successfully complete the remediation process and begin construction. The residential projects at both 2198 Market Street — also known as Linea — and 2175 Market Street were former gas stations.

One obvious reason for the uptick in the targeting of gas stations for condos, despite the increased cost, time and headache for developers, is the increase in property values in San Francisco. According to the 2013 Housing Opportunity Index report released by the National Association of Home Buildings, San Francisco ranks as the most unaffordable place to live in the U.S.

Secondly, with increasing contention over the gentrification of the city, developers may have a better case for moving forward with these types of projects than if they were to demolish an existing residential unit.

In the Historic Preservation Commission Memo for 899 Valencia, the developers made a strong argument for the community benefits of the project: It removes the eyesore of a dilapidated gas station, it does not require the demolition of a landmark or historic building, and, unlike the well-debated Ellis Act, it does not displace any current residents of a property.

There are so many Leaking Underground Storage Tanks in San Francisco, that the city simply cannot address them all, officials said.

To alleviate this problem, an incentive has been created for developers. If they take on the responsibility of cleaning up long-lasting contaminants in the soil, they become eligible for a reimbursement of up to $1.5 million from the Underground Storage Tank Cleanup Fund, which, according to Elyse Heilshorn, a senior inspector at the Department of Public Health, is the typical price tag for cleaning a LUST site.

To determine whether the soil has been cleaned up enough for residential development, samples are compared against a range of Environmental Screening Levels (ESLs) from the California Water Resources Control Board. The Environmental Screening Levels address the pollutants’ impact on the environment, water and human safety.

At 1198 Valencia, a Dual Phase Extraction system is currently operating to remediate both the soil and the groundwater.

In addition to 41,940 square feet of residential space, 1198 Valencia will also have 5,850 square feet of retail space and add 4,800 square feet of garage parking.

21 Comments

Good read, very informative. It is about time this blighted mess for a corner is developed into something. It has sat vacant for years; it is a breeding ground for crime. Vast upgrade when the condos/storefronts are built.

I recall that 1050 Valencia was a tire shop, not a gas station.
1000 Valencia, however, was a gas station as was 799 Guerrero/3598 19th St and the south east corner of Dolores and 17th. As I type this I just remembered five other old gas station sites.
These sites were converted to residential use so many years ago that most of us have forgotten what they used to be. If the present programs address the health issues, what about these other forgotten sites?

Generally, as a buyer you have to acknowledge that you understand there are potential pollutants in the ground and sign off any right to stiff the previous owner. At least this is common if your building is just within a certain distance of an old station with perc in the ground. IMHO it should be fine – just dont build a sandbox for your kids.

BTW I find your history of previous stations and locations interesting. Thanks.

Thank you for answering many of the questions I’ve had lately, watching these new projects develop. I hope that the gov’ment gets these oil & gas companies to pay up, somehow. At least we are never building a new gas station in SF again–presumably. Money well spent for a far better use of land.

John,
500,000 registered motor vehicles in SF.
The sites that were formerly gas stations and are of concern due to “leakage” include:
24th St at Church; 24th St between Vicksburg and Sanchez; 24th St at Diamond; Church at Jersey; Church at 27th St; Guerrero at 19th St; and Valencia at 21st St. Add in the locations listed in the article and any other corner sites with building that appear to have been built after 1970 and you can start to realize the implications. The properties are valuable and people need housing, but…..

The Fund is dropping from about $180 million (includes reimbursements and overhead) to about $91 million on Jan. 1, 2014. Reason? 6 mill surcharge fee on gas sales for last 4 years expires. Remedy? Some additional legislation is being proposed to restore the funding. See more at http://www.coreenvironmental.org.

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